Once an older adult decides that they want to explore a reverse mortgage as a potential solution, they are then faced with the next question: How do I find a reputable lender to work with?
A reverse mortgage is a big decision and it is important to work with a lender who is knowledgeable and committed to doing what’s right for the customer – not for themselves.
As an industry insider, I see first hand some of the aggressive marketing tactics used by my competitors and I don’t like it! So if you are exploring a reverse mortgage and want to ensure you’re working with someone reputable, your best bet is to work with:
(i) a large, reputable lender (not a fly-by-night operation)
(ii) a loan officer who focuses exclusively on reverse mortgages
(iii) a loan officer who has been in the reverse mortgage business for three years or more.
The top reverse mortgage lenders are Wells Fargo, Bank of America, Financial Freedom, and MetLife. Although there are many smaller brokers that offer reverse mortgages, they usually sell the loan to one of the major lenders, collect their fee, and move on to the next deal.
These days, economic conditions and tighter lending standards have reduced the demand for traditional “forward” mortgages. Many mortgage brokers are having a hard time making ends meet so they are jumping on the bandwagon of reverse mortgages. They are used to dealing with younger clientele and are generally more aggressive in their marketing efforts and sales conversations.
Some of these reverse mortgage newcomers will tell people that they have “been in mortgages for “X” number of years.” This is much different than having been in reverse mortgages for those years. As a government insured loan, reverse mortgages have many rules and guidelines associated with them.
Unless a loan officer specializes in reverse mortgages, they won’t understand the many nuances of this type of loan and will be less equipped to set expectations and avoid problems before they occur. When working with a loan officer, ask how long they have been working exclusively on reverse mortgages.
I recommend working with a loan officer who has specialized in reverse mortgages for three years or more. This is because, three years ago, the easy money was in regular “forward” mortgages and reverse mortgages weren’t very common. Reverse mortgage loan officers who persevered during those lean times undoubtedly have their heart in the right place – helping struggling seniors with patience and compassion.
There is plenty of information available online so be sure to do your homework in advance of meeting with a lender. If you do this and you adhere to my guidelines and connect with a reputable lender, you will ensure that you make the best decision for your situation.
Mark Schmidt has been a reverse mortgage specialist since 2004. In that time, he has guided hundreds of seniors through the reverse mortgage process. He is a veteran in the industry at a time when many others are “jumping on the bandwagon” of reverse mortgages.
A graduate of the University of Illinois, Mark also has an MBA from Loyola University and twelve years as a financial analyst with Merrill Lynch and Bank of America. To understand the needs of his clientele better, he was designated a Certified Senior Advisor in 2007 by completing additional studies of the social, physical, and financial aspects of aging.
Mark is the reverse mortgage expert for www.caregiverlist.com and is the author of “Reverse Mortgages: Facts and FAQs” which was in Amazon.com’s top five list for reverse mortgage books before selling out.
Mark can be reached at 773-504-9633 or you can email him directly.